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Sales Compensation Program

March 12, 2019  |   Compensation,Uncategorized   |     |   Comments Off on Sales Compensation Program

achievement-3658092_1280It’s important that a Sales Compensation Program has Plan Provisions to guide the administration of the Plan. The following are highlights of what those should be.

Goals and Plan Principles
It’s important to establish what the primary goals of the Plan are and the principles of the Plan as to how the Plan will be operationalized. For example: the Plan should be fair and equitable to the individuals covered by the Plan.

Sales Compensation Plan Elements
The elements of the Plan should be outlined to cover the following: eligibility; to identify why a base salary is provided; incentive caps; bonus/incentives; frequency and timing of payouts under the Plan; commission rates; and, special product incentives.

Sales Definitions
The terms of the Plan should be defined. Examples are items such as: what’s commissionable revenue; what’s the credit/return policy; plan year; split commissions; etc.

Sales Plan Guidelines and Policies
This covers areas such as: incentive adjustments; errors; what happens when there is a transfer, promotion and reassignment; what’s considered an extraordinary sale; what happens to sales compensation when a sales representative is on a Leave of Absence; disputes and controversies and how to handle those; termination provisions; ethical and legal standards; confidentiality; and, what administrative provisions are to govern the Plan. This will include the Sales Compensation Committee’s role in administering the Plan.

Contact Us

BCR has a great deal of experience in working with organizations on their Sales Compensation Plan documents and provisions. Reach out to us and we can discuss how we can assist your organization in developing the right Sales Compensation Guidelines and Plan documentation.

Written by: Barbara Manny, BCR President & Consultant

BCR is a local, minority-owned firm with more than 25 years experience in serving non-profit, public, and privately held entities in the key areas of Benefits and Compensation Consulting, Performance Management, Human Resource Organization Development, and Human Resource Information Systems and Processes.

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